China will soon impose an additional 34 per cent tariffs on all American imports in retaliation for Donald Trump’s 34 per cent levy.

Beijing announced the measure today, the most serious escalation in a trade war with Trump that has fed fears of a recession and triggered a global stock market rout.

The new tariff, which comes into effect on April 10, matches the rate of the ‘reciprocal’ tariff imposed by Trump this week. 

The measures are in addition to the existing tariffs already imposed on US goods.

Beijing’s commerce ministry also said it will impose more export controls on rare earths, which are materials used in high-tech products such as computer chips and electric vehicle batteries.

Beijing also added 11 entities to the ‘unreliable entity’ list, which allows Beijing to take punitive actions against foreign entities. 

China has also filed a lawsuit with the World Trade Organization (WTO) over sweeping US tariffs imposed on its exports. 

It comes after Trump ignited a potentially ruinous global trade war this week by imposing 10 per cent levies on imports from around the world and harsh extra duties on key trading partners.

China will soon impose an additional 34 per cent tariffs on all American imports in retaliation for Donald Trump ‘s 34 per cent levy. Pictured: Chinese President Xi Jinping on March 28

Beijing swiftly vowed ‘countermeasures’ to protect its rights and interests after Washington this week imposed steep new levies on Chinese products. 

‘For all imported goods originating from the US, an additional tariff of 34 per cent on top of the current applicable tariff rate will be imposed,’ China’s Finance Ministry said today.

Beijing’s Commerce Ministry also imposed export controls on seven rare earth elements – including samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium – to the US, effective April 4.

‘The purpose of the Chinese government’s implementation of export controls on relevant items in accordance with the law is to better safeguard national security and interests, and to fulfill international obligations such as non-proliferation,’ the Commerce Ministry said in a statement.

The Commerce Ministry added: ‘China has filed a lawsuit under the WTO dispute settlement mechanism.’

It comes after the Commerce Ministry issued a statement yesterday condemning the US measures as a ‘typical act of unilateral bullying’.

Beijing urged the Trump Administration to ‘immediately’ remove the tariffs and encouraged the US to resolve dispute through ‘fair and equal dialogue’.

Trump’s latest tariff hikes on US imports are compelling countries and industries to scramble for footing in a time of potential upheavals in global trade. 

Nations from Canada to China have readied retaliation in an escalating trade war after Trump raised US tariff barriers to their highest level in more than a century this week, leading to a plunge in world financial markets.

President Donald Trump delivers remarks on tariffs at the White House on Wednesday

As world markets wallowed in more heavy losses today, Taiwan’s president promised to provide support to industries most vulnerable to the 32 per cent tariffs Trump ordered in his ‘Liberation Day’ reciprocal tariffs announcement.

Vietnam said its deputy prime minister would visit the US for talks on trade. 

Some, like the head of the EU’s European Commission, have vowed to fight back while promising to improve the rules book for free trade. 

Others said they were hoping to negotiate with the Trump administration for relief.

In Japan, one of America’s top trading partners, Prime Minister Shigeru Ishiba said that the tariffs had created a ‘national crisis’ as a plunge in banking shares today set Tokyo’s stock market on course for its worst week in years.

Investment bank JP Morgan said it now sees a 60 per cent chance of the global economy entering recession by year end, up from 40 per cent previously.

European stock markets and global oil prices tanked this morning, extending a rout as investors fret over the impact of Trump’s tariffs onslaught. 

Frankfurt’s DAX index of blue-chip companies fell as much as five percent after midday while Paris shed four percent and London was down 3.8 percent.

Crude oil prices fell more than five percent, with Brent North Sea, the international benchmark, reaching $66.64 per barrel after already hitting the lowest level since December 2021 while US contract WTI dropped to $63.45.

India was hit by a 26 per cent tariff rate, lower than the 34 per cent for Chinese exports and 46 per cent for Vietnam. 

Its Commerce Ministry that it was ‘studying the opportunities that may arise due to this new development in US trade policy.’ It said talks were underway on a trade agreement, including ‘deepening supply chain integration’.

The US was New Delhi’s biggest trading partner in 2024 with two-way trade estimated at $129 billion, according to US data. They have set an ambitious target of more than doubling their bilateral trade to $500 billion by 2030. 

Most pharmaceuticals and other medicines, important Indian exports to the US, are exempt from the reciprocal tariffs. However, diamonds and other gems, another major export industry, are subject to the higher duties.

Cargo shipping containers are stacked at the Port Authority of Thailand in Bangkok today. Thailand is facing significant economic repercussions following President Trump’s ‘Liberation Day’ announcement, which imposes a 36 per cent reciprocal tariff on Thai exports to the US

Most US trading partners have emphasised they hope negotiations can help resolve trade friction with Washington. 

In Italy, Premier Giorgia Meloni told state TV she believes the 20 per cent US tariffs on exports from Europe were wrong, but ‘it is not the catastrophe that some are making it out to be.’ Her government planned to meet next week with representatives of affected sectors to formulate plans. 

Japan’s leader Ishiba and other governments also said they were preparing countermeasures to help industries cope.

Likewise, President of the European Commission Ursula von der Leyen said the EU was consulting with steel and auto makers, pharmaceutical companies and other industries about how to give them more ‘breathing space.’

This is a breaking news story. Check back for updates.